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Income Tax Appellate Tribunal, JAIPUR BENCHES “A”, JAIPUR
Before: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 87/Jodh/2019
आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES “A”, JAIPUR Jh lanhi x®lkÃa] U;kf;d lnL; ,oa Jh foØe flag ;kno] ys[kk lnL; ds le{k BEFORE SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SINGH YADAV, AM vk;dj vihy la-@ITA No. 87/Jodh/2019 fu/kZkj.k o"kZ@Assessment Year :2011-12 Vamita Singh, cuke ITO, Vs. C/o-Ashok Kumar Bansal, C.A., Ward-7(3) 2nd Vijay Shanti Plaza, Near Jaipur. Railway Crossing, Balotra-344022. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ATZPS 9372 B vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by: Shri Ashok Kumar Bansal (CA) jktLo dh vksj ls@ Revenue by : Smt. Monisha Choudhary(Addl.CIT) lquokbZ dh rkjh[k@ Date of Hearing : 22/12/2020 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 24/02/2021 vkns'k@ ORDER PER: SANDEEP GOSAIN, J.M. The present appeal has been filed by the assessee against the order of the ld. CIT(A)-3, Jaipur dated 20/11/2018 for the A.Y. 2011-12.
The hearing of the appeal was concluded through video conference in view of the prevailing situation of Covid-19 Pandemic.
As per the facts of the present case, an order U/s 271(1)(b) of the Income Tax Act, 1961 (in short, the Act) was passed by the A.O. on the ground that the return of income was filed by the assessee on 27/07/2011 declaring total income of Rs. 12,80,870/- after claiming deduction of Rs. 1,31,000/-. The case of the assessee was selected for
2 ITA 87/Jodh/2019_ Vamita Singh Vs ITO scrutiny through CASS and notice U/s 143(2) of the Act was issued and served upon the assessee and subsequently notice U/s 142(1) of the Act alongwith query letter was also issued but those notices could not be complied by the assessee. Therefore, the A.O. considered that the assessee has not cooperated with the department in finalizing the scrutiny assessment proceedings, therefore levied penalty U/s 271(1)(b) of the Act at Rs. 40,000/-.
Aggrieved by the order of penalty imposed U/s 271(1)(b) of the Act, the assessee preferred appeal before the ld. CIT(A), however, the ld. CIT(A) dismissed the appeal of the assessee in limini on the ground that there was delay of 624 days in filing the appeal and the assessee could not justify the condonation of delay with sufficient cause or reasons, therefore, appeal of the assessee was dismissed at the stage of admission vide impugned order.
Aggrieved by the order of the ld. CIT(A), the assessee has preferred the present appeal before the ITAT on the grounds mentioned below. “1. On the facts and circumstances of the case and in law the Commissioner of Income Tax Appeal is contrary to provision of law, contrary to all cannons of natural justice and is also contrary to facts, material and evidence existing on records. 2. The Commissioner of Income Tax Appeal has rejected the appeal at admission stage stating that since appellant
3 ITA 87/Jodh/2019_ Vamita Singh Vs ITO concealed the fact from revenue for the date of service of order hence same is being rejected the condonation for delay. 3. The Commissioner of Income Tax (Appeal) grossly erred in rejecting the appeal without verifying the genuineness of the reason that since appellant did not get original order therefore she was submitted the application for the certified copy of order and as soon it was available to the assessee appeal for the same filed, hence it could not be stated that appellant had concealed the fact from revenue. 4. The assessee is Addl. Chief judicial magistrate in Rajasthan Judicial services. The Appellant filed her return on 27.07.2011 vide E-filing acknowledgment no. 249076100270711 declaring total income of 12,80,870/-. Thereafter the case was selected for scrutiny and notice u/s 143(2) dated 01.08.2012 & notice u/s 142(1) dated 12.06.2013, 13.12.2013, 09.01.2014, 28.01.2014 was served for A.Y. 2011-12 at her Pali and Kekri District Ajmer. But there was transfer of appellant to various places of Rajasthan. Due to which the notices u/s 143(2) & 142(1) was not served and she fails to attend and file reply on the date of hearing. Due to this Ld. AO passed ex-parte order on 04.03.2013 U/s 143(3)/144 and levied penalty u/s 271(1)(b) of Rs. 40,000 @ Rs.10,000 for 4 instances of non-compliance. This order was also not properly served and received by assessee, so certified copy was obtained on 30.05.2016 and appeal is preferred with delay. 5. Respected Sir, the Ld. AO has failed in facts & law in imposing penalty of Rs. 40,000/- u/s 271(1)(b) on account of non- compliance of notice ignoring the known fact that assessee is in Rajasthan Higher Judicial Services, Government of Rajasthan and regularly transferred from one place to another & no proper service of notice was made to her. Request for Delay Condonation of 625 days, as order u/s 271(1)(b) was not served to the assessee and after obtaining certified copy of order appeal was preferred within time limit.
4 ITA 87/Jodh/2019_ Vamita Singh Vs ITO 6. The appellant craves leaves to add, alter, modify or delete any of the grounds of appeal on or before its hearing before your honor.” 6. There was delay of 62 days in filing the present appeal, for which, the authorized representative of the assessee has filed application for condonation of delay and stated as under:
“That On behalf of the assessee I requested your good self for condonation of delay in filing appeal against demand created vide order dated:- 20-11-2018 which was served to assessee on 25th, Nov., 2018.
That though appeal was due for filing on 19-01-2019, but since there was a casualty happened in the family of assessee, therefore she was fully completely disturbed hence appeal for year could not submitted within stipulated time therefore on behalf of the assessee I requested your good self for condonation of delay in filing appeal.
In the light of the above mentioned facts submit that the delay is due to the circumstances beyond our control. Accordingly requesting your honor to condone the delay and entertain the appeal.
Sir we will be grateful to your honor for allowing the condonation of delay in filing the appeal.”
We have considered the rival submissions as well as relevant material on record. As regards the sufficiency of cause for filing the appeals belatedly, it is settled principles of law that the Courts have to
5 ITA 87/Jodh/2019_ Vamita Singh Vs ITO take liberal approach while interpreting the expression ‘sufficient cause’ for condonation of delay. In case of Collector, Land Acquisition Vs. Mst. Katiji (1987) 167 ITR 471, the Hon’ble Supreme Court has laid down the principle that the power to condone the delay provided under the statute is to enable the Courts to do substantial justice to the parties by disposing of the matter on merits, therefore, while considering the matters for condonation of delay, the law must be applied in a meaningful manner which subserves ends of justice and technical considerations should not come on the way of cause of substantial justice. There is no quarrel that the explanation and reasons explained for delay must be bonafide and not merely a device to cover an ulterior purpose such as laches on the part of the litigant or an attempt to save limitation in the underhand way. If the party who is seeking condonation of delay has not acted in malafide manner and reasons explained are factually correct then the Court should be liberal in construing the sufficient cause and lean in favour of such party. A justice-oriented approach has to be taken while deciding the matter for condonation of delay. However, this does not mean that a litigant gets free right to approach the court at its will. If we apply the settled principles as laid down by the Hon’ble Supreme Court as well as other courts on the facts of the present case, we find that the assessee has explained cause of delay, therefore, in the facts and
6 ITA 87/Jodh/2019_ Vamita Singh Vs ITO circumstances of the case, we condone the delay of 62 days in filing the present appeal and admit the appeal for hearing.
All the grounds raised by the assessee are interrelated and interconnected and relates to challenging the order of imposing and sustaining penalty U/s 271(1)(b) of the Act, therefore, we thought it fit to dispose off all the grounds by this consolidated order.
The ld AR appearing on behalf of the assessee has reiterated the same arguments as were raised before the ld. CIT(A) and also relied upon the written submissions submitted before him which are reproduced below:
With reference to above, in our case, the assessee is Addl. Chief Judicial Magistrate in Rajasthan Judicial Services presently posted at Barmer. During the AY 2012-13 the assessee was transferred to Collectorate Pali as -a Civil Judge & Judicial Magistrate. During the AY 2013-14 the assessee was transferred to Court Campus Kekri as a Civil Judge & Judicial Magistrate. During the AY 2014-15 the assessee was transferred to Court Campus Kekri as an Additional Civil Niyayadhish (Kanisth). During the AY 2015-16 the assessee was transferred as Judicial Magistrate Jaipur. During the AY 2016-17 the assessee was transferred as Judicial Magistrate Jodhpur and at present at Barmer.
Hence, from all these facts it is clear that the assessee is continuously migrating from one district to another for the purpose of serving her duties to the Government of Rajasthan (Law Department). Due to the transferable job, which is uncontrollable in
7 ITA 87/Jodh/2019_ Vamita Singh Vs ITO the hands of the assessee hence she was unable to comply with a notice under section 142(1).
After knowing the fact and circumstances, the assessee had responded the notices. The authorized representative had attended the department and appellate proceedings and all demand was made NIL at quantum assessment. Certified copy of order was obtained and thereafter appeal is preferred with delay of 625 days before your honour with this petition far condonation of delay in filing of appeal. Our point wise submission is as under for condonation of delay:-
We hereby states that as per the provisions of the section 246(2)(b) of Income tax Act, 1961 an appeal may be filed by the appellant within 30 days from the date of the service of the notice of mand relating to the assessment or penalty, but as per section 249(3), an appeal can he admitted even after expiration of the said period , if appellant has sufficient cause for not presenting it within that period, In the present case also assessee could have filed an appeal within the stipulated time frame, but she was migrating from one district to another for the purpose of serving her duties to the Government of Rajasthan (Law Department). Due to the transferable job, this is uncontrollable in the hands of the assessee. Thereafter so appeal is preferred with delay of 625 days. Further, requesting the condonation of delay, we are relying' on the following decisions:-
It has been held in a similar case in the case of COLLECTOR LAND ACQUISITION Vs. MST, KAIJI AND OTHERS-(1987) 167 ITR 471(SC): In the above case it was held that the delay can be condoned if there exists sufficient cause for the delay and the reasons for the same is properly evidenced. The appeal should be dispose of on merit after affording reasonable opportunity of hearing to both the sides.
8 ITA 87/Jodh/2019_ Vamita Singh Vs ITO 3. STATE OF UP Vs. BAHADUR SINGH & OTHERS (1983)142 ITR 745(SC) It was judicially decided that where the explanation for the delay is convincing and reasonable, a writ petition cannot be dismissed merely on the ground that the same was filed after a long time.
ANIL SON1 V/s. ITO (1992) 52 TAXMAN 48,49 (J&K): Laches is not absolute bar if the court is otherwise satisfied with the justness of the petitioner's claim that relief can be granted to the petitioner who approaches time court n somewhat belatedly.
The cases highlighted above clearly specifies that merely delay in filing cannot the ground for rejection of an appeal is the reason that the legislature itself has conferred the power to condone delay by enacting section 5 of the Limitation Act of 1963 in order to enable the court to do the substantial justice to the parties by disposing of matter on "merits". The expression "Sufficient cause" employed by the legislature is adequately elastic to enable the court to apply the law in a meaning manner which sub serves the ends of justice- that being the life purpose of the existence of the institution of courts.
Therefore, your goodself is requested to please condone the delay, as your acceptance can render natural justice to the assessee. There remains no ground for the denial of the acceptance of appeal of the assessee as quantum appeal is already decided in favour of assessee by CIT Appeals, Jodhpur."
On the other hand, the ld DR has relied on the orders of the revenue authorities.
We have considered the rival contentions and carefully perused the material available on record. From the facts of the present case, we
9 ITA 87/Jodh/2019_ Vamita Singh Vs ITO noticed that it is an undisputed fact that the assessee is an Additional Chief Judicial Magistrate in Rajasthan Judicial Services. The assessee filed her return of income on 27/07/2011 declaring total income of Rs. 12,80,870/-. The case of the assessee was selected for scrutiny and notice U/s 143(2) and 142(1) of the Act were issued and served at her Pali and Kekri district, Ajmer residence. However, in the meantime, the assessee was transferred to various places of Rajasthan. A chart showing the fact of notices issued but at that time, the assessee was posted at another place, is as under: Particular Date of Notice Assessee Posted at Notice U/s 142(1) issued at 12/06/2013 Assessee was posted Kekari at Jaipur Notice U/s 142(1) issued at 13/12/2013 Assessee was posted Pali at Jaipur Notice U/s 142(1) issued at 09/01/2014 Assessee was posted Pali at Jaipur Notice U/s 142(1) issued at 28/01/2014 Assessee was posted Pali at Jaipur From the above chart, we noticed that the assesseee at that relevant time was posted at Jaipur and since all the notices issued by the Revenue were served at Pali and Kakari but were never personally served upon the assessee as at that particular time, the assessee was posted at Jaipur, therefore, service of notices could not be taken effect upon the assessee and because of this reason, the said notices U/s 143(2) and 142(1) of the Act could not be complied with by the assessee. The Revenue has not
10 ITA 87/Jodh/2019_ Vamita Singh Vs ITO been able to demonstrate before us that even a single notice was ever served upon the assessee. However, even as per the order of the A.O., notice was served either upon one Shri Rajesh Davera or upon one Shri Raghverder but no notice was served upon the assessee and the order of penalty passed U/s 271(1)(b) of the Act even do not mention the relation of said alleged Shri Rajesh Davera and Shri Raghverder with the assessee. From the above facts and circumstances of the case, we found that non-receipt of notice by the assessee was the reasons for non- compliance of notices which according to us is a “reasonable cause”, therefore, in our view, penalty U/s 271(1)(b) of the Act could not be imposed. In this regard, we rely upon the decision of Coordinate Bench of Delhi ITAT in the case of Balram Kumar Mahendra Vs ITO (2011) 012 ITR (Trib) 0426 wherein it was held as under:
“that the AO issued notice under section 143(2) to him but there was no reply. A notice under section 143(2) was again issued but no one attended it. AO, then, imposed penalty under section 271(1)(b) for non-compliance of notice under section 143(2). Assessees contended that non-receipt of notice was the reason for non-compliance of notice which was a reasonable cause therefore, penalty levied should be deleted. The Department had got the new address of assessee as earlier notice seeking details were sent at the new and correct address. Section 273B provides that, inter alia, penalty under section 271(1)(b) need not be imposed, if it is proved that there was a reasonable cause for the said failure of the assessee to comply with the provisions of section 271(I)(b). In this case it was found that non- appearance of assessee before the AO the in opinion of Tribunal was caused by non-receipt of the notice and was a reasonable cause, therefore, penalty was deleted."
11 ITA 87/Jodh/2019_ Vamita Singh Vs ITO 12. In our view, Section 273B of the Act clearly provides, inter alia, that penalty U/s 271(1)(b) of the Act need not be imposed, if it is proved that there was a ‘reasonable cause’ for the said failure of the assessee to comply with the provisions of Section 271(1)(b) of the Act. From the facts of the present case, we found that non-appearance of the assessee before the A.O. or non-compliance of the notices issued was only because of ‘non-receipt of the notices’ by the assessee and therefore, in our considered view, the same was a “reasonable cause” as has also been held by the Hon’ble Delhi High Court in the case of Woodward Governor Nidia P Ltd. Vs CIT (2002) 253 ITR 745 (Delhi) wherein it was held that levy of penalty is not automatic and the absence of a ‘reasonable cause’ is necessary.
Further, the Coordinate Bench of Indore ITAT, in the case of M.P. State Civil Supplies Corporation Ltd. Vs ACIT in ITA No. 713/Ind/2015, 2016 Tax Pub (DT) 4071 (Ind-Trib) has held as under:
“that power to levy the penalty is discretionary and penalty cannot be levied merely because it is lawful to do so. No penalty could be levied for technical and venial breach of provisions and no penalty could be levied where the breach of provisions flowed from bonafide belief of the assessee. Therefore, the failure of the assessee to comply with the notice could not be said to be a default which would justify the levy of penalty under section 271(1)(b).”
12 ITA 87/Jodh/2019_ Vamita Singh Vs ITO The Coordinate Bench of ITAT, Chennai in case of V.B. Senthil Kumar v. ACIT in I.T.A. Nos. 688 to 694/Mds/2011, 2013 TaxPub (DT) 0484 (Chen-Trib) has held as under:
“Assessee is a Non-Resident Indian (NRI), shows that he had genuine difficulties in complying with the notices issued by the assessing authority, within the time allowed. His pre-occupation outside India definitely dilutes the gravity of the charge leveled against him therefore, penalty under section 271(1)(b) was deleted.” Since, in the present case, there is nothing on record which could suggest that required notices either U/s 143(2) or 142(1) of the Act were ever served upon the assessee, therefore, non-compliance on account of non- receipt of notice by the assessee could not be taken as intentional. Even otherwise, as per record, the only source of income of the assessee is from salary from Government of Rajasthan on which TDS has all ready been deducted and apart from this there is no other source of income of the assessee. Hence, there could not be any intention upon the assessee for skipping the service of notices. It was proved that there was ‘reasonable cause’ for the assessee in failure to comply with the provisions of Section 271(1)(b) of the Act as the ‘non-appearance’ of the assessee before the A.O. was only because of the ‘non-receipts’ of the notices. Therefore, while considering the totality of the facts and circumstances of the case as well as the principles laid down by the
13 ITA 87/Jodh/2019_ Vamita Singh Vs ITO Hon’ble High court and the Coordinate Benches of the ITAT, we direct the A.O. to delete the penalty.
In the result, appeal of the assessee is allowed.
Order pronounced in the open court on 24th February, 2020. Sd/- Sd/- ¼foØe flag ;kno½ ¼lanhi x®lkÃa½ (VIKRAM SINGH YADAV) (SANDEEP GOSAIN) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 24/02/2021 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Ms. Vamita Singh, Jaipur. 1. izR;FkhZ@ The Respondent- The ITO, Ward 7(3), Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 87/JP/2019) 6. vkns'kkuqlkj@ By order,
सहायक पंजीकार@Aेेज. त्महपेजतंत